The JobKeeper programme has paid A$1,500 (£825) a fortnight - less generous than the United Kingdom scheme worth up to £2,500 a month - but will fall to $1,200 a month from the end of September.
"What the review also found was that there were a number of features of JobKeeper that created adverse incentives which may become more pronounced over time as the economy recovers".
The PM announced yesterday that payments will fall from $1,500 to $1,200 per fortnight after September and people working fewer than 20 hours each week will receive $750.
Mr Morrison said Australians understood both programs were temporary.
"That's why the unemployment (benefit) rate will be elevated for some time and that will be reflected in the forecasts from Treasury tomorrow", he said.
Around 3.5 million workers have received wage subsidies created to keep employees linked to employers during the pandemic.
"The two-tiered payment better reflects the pre-COVID income of these recipients". "Given the likely long tail of high unemployment, its likely that income support measures will also have to be extended next year".
From August 4, if you are on JobSeeker you will have to prove you have undertaken at least four job searches a month, Mr Morrison said.
"So if there is a job to be taken and a job that is being offered, then it is an obligation, a mutual obligation, for those who are on Jobseeker to take those jobs where they're on offer".
Reserve Bank of Australia governor Philip Lowe welcomed the moves: "They're both providing important support to households and businesses and they're both playing an important role in reducing the costly scarring to the economy". Recipients will have to face a higher job search rate come September, and they'll also be reintroducing an asset test and a partner income test. We will be maintaining the eased restrictions around sole traders for their eligibility for Jobseeker.
"Sadly, as a result of this global health pandemic, businesses will close and people will lose their jobs, but that is why we have extended the Coronavirus Supplement and announced a new skills package to help people transition from welfare to work".
To encourage people back into the workforce, the government will increase the income free area for the JobSeeker Payment and Youth Allowance from $106 per fortnight to $300 per fortnight.
If you are unemployed want information about Jobseeker you can find it here and here.
"We will apply the JobKeeper test for the 30 percent turnover reduction across the past two quarters and into the next quarter for continuing eligibility", Morrison said.
But there were also perverse incentives in some cases for some workers to refuse to do more hours even if they were getting paid extra under JobKeeper.